KKR to acquire 5% interest in Marvell - sources

November 6
7:54 AM 2013

Two sources said that private equity firm KKR & Co would be acquiring a 5% ownership stake in Marvell Technology Group Ltd.

One of the sources said KKR had been engaging with the founders of the Hamilton, Bermuda-based company, who are Chief Executive Officer Sehat Sutardja and brother Pantas Sutardja. The same person said the New York-based firm would most likely propose a leveraged buyout of the computer chipmaker.

Investor sentiment about the news might have been positive, as Marvell saw its shares increased 8.5% to USD13.04 on trading close. The share price hike was Marvell's biggest one-day gain since May of last year. According to Businessweek, Marvell's shares rose 80% this year.

Businessweek estimated that a 5% ownership stake would value at a rough USD296 million. The estimate was based from the computer chipmaker's USD5.9 billion market value yesterday. The Sutardjas owned more than 20% of the company's stock, while David Einhorn-run Greenlight Capital Inc owned a 9% holding, based from Bloomberg data.

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